Scott Morrison’s $5b coronavirus prescription

 

A ONE-off cash payment for pensioners and Newstart recipients is on the table ahead of critical Morrison Government war gaming to inoculate the Australian economy from the coronavirus.

The Expenditure Review Committee will meet today as Scott Morrison prepares to unveil a multibillion-dollar stimulus package to keep people in jobs while production in China remains soft and Australia's tourism and education sectors take a battering.

Mr Morrison will today warn in a headline speech that the coronavirus is "one of those national interest moments" that could have a bigger financial impact that the global financial crisis in 2008.

 

Prime Minister Scott Morrison will today warn in a headline speech that the coronavirus is “one of those national interest moments” that could have a bigger financial impact that the global financial crisis in 2008. Picture: AAP Image/Mick Tsikas
Prime Minister Scott Morrison will today warn in a headline speech that the coronavirus is “one of those national interest moments” that could have a bigger financial impact that the global financial crisis in 2008. Picture: AAP Image/Mick Tsikas

 

It comes as 92 cases of coronavirus have been confirmed in Australia while the number of global cases has soared above 110,000. Three Australians have died from the disease.

Queensland has recorded 15 cases as the state's biggest hospital, the Royal Brisbane and Women's, established a fever clinic tent to isolate people who have potentially been infected from other emergency department patients.

Mr Morrison will on Tuesday reveal that the Government's economic boost, which is set to be outlined later this week, will be guided by seven principles including "boosting domestic consumption" - a signal that some households could receive a cash splash.

The Courier-Mail can reveal that ministers have been asked to put forward options for one-off cash payments for those on fixed incomes, including more than two million full and part-pensioners.

 

CORONAVIRUS BY THE NUMBERS

Worldwide Cases: 110,041

Total deaths: 3825

Australian cases: 92

Australian deaths: 3

 

It comes as almost $140 billion was wiped from the Australian share market yesterday - further cruelling some self-funded retirees who are also battling low returns because of rock-bottom interest rates.

As of yesterday, a one-off sugar hit for those on the pension and Newstart had not been ruled out but nothing had been set in stone.

While Mr Morrison will unveil a package - which will exceed $5 billion - that will focus on supply chains and keeping people in jobs, there is a growing view in the Government that consumer demand is at risk, meaning people may be hanging on to their money because their confidence in the economy is being zapped.

 

 

It is believed those on fixed incomes - such as the aged pension and Newstart - are more likely to spend the cash than save it. A large proportion of Australians who have benefited from recent interest rate cuts have saved the extra cash instead of spending it.

When the Rudd government gave four million pensioners, carers, seniors and veterans a cash payment of up to $1400 during the global financial crisis, it alone cost the Budget almost $4.8 billion.

Mr Morrison will tell a business summit in Sydney today that employers also had to play their part by paying invoices on time, keeping people in work and allowing them to take paid leave if sick.

"Whatever you thought 2020 was going to be about, think again,'' Mr Morrison will say in his speech.

 

 

"We now have one goal in 2020 - to protect the health, wellbeing and livelihoods of Australians through this global crisis, and to ensure that when the recovery comes, and it will, we are well positioned to bounce back strongly on the other side."

Mr Morrison does not mention details of the surplus - which is likely written off - in the speech but reaffirms the Budget is back in balance. He will pledge not to step back from the Government's $100 billion infrastructure plan, listing new drugs on the PBS or other essential services.

Mr Morrison's speech also reveals the Government will use the May Budget to ramp-up the package if needed, that it will use existing levers to stimulate the economy, such as tax breaks and will not bake anything into the economy - meaning the economic stimulus will be short and sharp.